Improving Financial Well-Being
Financial well-being is not just about money; it’s about wellness. And it is within reach for everyone, no matter your age, income level, or life circumstances—depending on your mindset and the actions you take. It may take coordinating several aspects of your financial picture and can look different for everyone. Consider making changes in these four areas to improve your financial well-being:
Budgeting: Tracking how you spend your money will help you gain a sense of control over your finances. Knowing where your money is going can help you make good financial decisions that can improve your overall financial well-being. Also, consider taking advantage of various tools designed to help you stay on track with your budget.
Borrowing Strategically: The key is to make wise choices about borrowing. Aim for a debt-to-income ratio below 36%, and make timely payments on loans and credit cards. Try to save up to 20% of what you need for a large purchase before borrowing the rest. This practice will strengthen your borrowing position and can feel rewarding.
Preparing for Emergencies: To create an emergency financial plan, prioritize a savings fund for unexpected expenses. Set aside enough money to cover three to six months of living expenses. Additionally, consider incorporating insurance products into your emergency preparation.
Planning: To achieve big life goals without added stress, plan ahead. Saving for significant purchases like a house requires time. By planning and being patient, you can meet current financial obligations while saving for future goals.
